Virgin Galactic Holdings Inc. (NYSE:SPCE), the space-tourism venture backed by billionaire Richard Branson, saw its stock plummet to a 52-week low of $4.13. With a current market capitalization of just $119.54 million and trailing twelve-month revenue of $9.42 million, the company faces significant challenges. InvestingPro analysis shows the company holds more cash than debt on its balance sheet, though it's quickly burning through these reserves. This latest price level reflects a precipitous drop from its previous positions, underscoring the challenges the company faces in a competitive and capital-intensive industry. Over the past year, the stock has experienced a dramatic downturn, with the 1-year change data revealing a staggering 88.86% decline. Investors have shown concern over the company's prolonged timeline to commercial operations and profitability, as well as the broader market's waning appetite for speculative growth stocks. The company's stark -899% gross profit margin highlights these operational challenges. According to InvestingPro, which offers 18 additional investment insights for this stock, the company's Fair Value analysis suggests it may be undervalued at current levels.
In other recent news, Virgin Galactic Holdings Inc. is considering expanding its space tourism operations to Italy. The company plans to initiate discussions with the Italian Civil Aviation Authority about the potential use of Grottaglie Spaceport, located in the Puglia region, for future missions. Virgin Galactic's current launch site is Spaceport America in New Mexico, and the proposed expansion would mark its first venture into the European market.
Meanwhile, Bernstein SocGen Group has maintained its Underperform rating on Virgin Galactic due to concerns about the company's developmental progress and financial outlook. The firm points to Virgin Galactic's history of missed timelines, particularly with its Delta spaceship development and the commencement of commercial flights. The company's repeated delays have increased the discount on its cash valuation and raised concerns about potential liquidity risks.
Virgin Galactic recently announced an up to $300 million at-the-market equity offering to expedite the development of its second mothership and the third and fourth Delta ships. However, Bernstein SocGen Group warns that the company's cash outflows could rise if there are further delays in these projects. These are recent developments for Virgin Galactic as it navigates its expansion and development plans.
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